Apple's (AAPL, $133.72) stock price was up modestly today on the back of an analyst note from Wedbush's Dan Ives saying that supply chain checks for iPhone 12 units "have now exceeded even our 'bull case scenario' for units in FY21."
"Based on our recent Asia checks we believe the supply chain is anticipating low to mid 90 million iPhone unit builds … a roughly 35% increase from our original and Street forecasts," says Ives, who covers AAPL stock for Wedbush.
Compare that to the firm's expectations for iPhone 12 unit sales over time. Three months ago, Wedbush expected 65 million to 70 million unit builds for the December quarter; it raised its outlook to 75 million units in late October; and in mid-December, it set a "stretch goal" in the mid-80 million range.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Momentum for Apple's foray into 5G technology is building for the March quarter, too. "Builds for total iPhones ticked up again another 5% over the last week and are now in the 60 million to 70 million range," Ives says.
Wall Street broadly sees AAPL selling 217 million iPhones in the company's fiscal 2021, but Wedbush's bull case is "north of 240 million units (250 million could be in the cards – an eye popping figure)" that would easily surpass the 231 million units the company sold in its fiscal 2015.
"We have not seen a launch uptrend such as this in a number of years for Apple and the only iPhone trajectory similar would be the iPhone 6 in 2014 based on our analysis."
Driving strength is China, which Ives calls a "linchpin to Apple's 5G supercycle." The country is providing "considerable strength" in sales, and trends appear to be positive heading into 2021.
AAPL stock set a new closing high of $136.69 per share on Dec. 28 and continues to trade close to that level amid continued optimism over this iPhone cycle. Wedbush's Ives maintained his Outperform rating (equivalent of Buy) and a $160 price target – a 17% gain from Wednesday's closing price. However, he sees a bull-case price target of $200, or 46% potential upside, for Apple's shares.
-
Stock Market Today: Stocks Close Mixed Amid War Angst, Nvidia AnxietyMarkets went into risk-off mode amid rising geopolitical tensions and high anxiety ahead of bellwether Nvidia's earnings report.
-
What the Comcast Cable Spinoff Means for InvestorsComcast has announced plans to spin off select cable networks and digital assets into a separate publicly traded company. Here's what you need to know.
-
Stock Market Today: Stocks Rally Despite Rising Geopolitical TensionThe main indexes were mixed on Tuesday but closed well off their lows after an early flight to safety.
-
Why Is Warren Buffett Selling So Much Stock?Berkshire Hathaway is dumping equities, hoarding cash and making market participants nervous.
-
Stock Market Today: Stocks Slip Ahead of Election Day, Fed DecisionPost-earnings strength from Amazon and Intel helped cushion the blow of a disappointing October jobs report.
-
Stock Market Today: Dow Climbs 288 Points After Amazon, Intel EarningsPost-earnings strength from Amazon and Intel helped cushion the blow of a disappointing October jobs report.
-
Apple Stock Slips After Earnings. Wall Street Isn't WorriedApple stock is trading lower Friday despite the iPhone maker beating expectations for its fiscal fourth quarter, but analysts are still bullish.
-
Stock Market Today: Stocks Struggle After Meta, Microsoft EarningsAll three major indexes closed lower on Thursday, making for a grim Halloween.
-
Stock Market Today: Stocks Slide as Solid GDP and Softer Inflation Vex Rate Cut BetsEncouraging economic news damped hopes for accelerated rate cuts.
-
If You'd Put $1,000 Into Google Stock 20 Years Ago, Here's What You'd Have TodayGoogle parent Alphabet has been a market-beating machine for ages.
